Early '03 hiring plans point to increase

Manpower survey shows employers remain cautious

By

RachelKoning

MILWAUKEE (CBS.MW) -- Hiring plans for the start of 2003 are more upbeat than a year ago, but companies remain hesitant to aggressively expand payrolls, according to a Manpower Inc. survey released Monday.

While the hiring numbers have improved over a year ago, the latest quarterly survey from the staffing firm shows that a stalled economic recovery has left employers more cautious about job growth than they were just a few months ago.

Part of their hesitation, however, may be tied to seasonal factors and to what's typically a slower pace of hiring at the start of the year compared to later on.

Of the nearly 16,000 employers polled, 20 percent said they will take on more staff in the first quarter. That compares to 16 percent who said a year ago they planned to step up hiring in the first three months of 2002, but it's also down from the 24 percent who predicted expanding their payrolls in the current quarter.

While noting a continuing "high level of uncertainty among employers," Jeffrey Joerres, chairman and CEO of Manpower, said the survey data nonetheless "reveal hiring levels above those seen during the post-recessionary period of the early 1990s."

Meanwhile, 12 percent of the employers polled intend to cut their work force in the first quarter, higher than the 9 percent who expressed such plans for the fourth quarter. A year ago, 16 percent of firms in the survey expected to slash positions in the New Year.

Sixty-two percent of companies plan to maintain their current staff levels, the same as for the 2002 fourth quarter, and 6 percent are uncertain. A year ago, 61 percent planned to maintain their current staff and 7 percent couldn't make a first-quarter prediction.

Prescription for hiring stability

"The Q1 2003 Manpower hiring intentions survey points towards payroll growth averaging 134,000 per month beginning in January. This is very close to the 140,000-per-month growth rate typically associated with a stable unemployment rate and suggests that the worst of the labor market may be behind us," said Drew Matus, economist with Lehman Brothers.

As for specific industries, durable goods manufacturers foresee little change in payrolls to start the year, but that's an improvement from the start of 2001 and 2002 when layoffs were occurring on a regular basis. Employers turning out non-durable goods expect to increase their hiring compared to a year ago.

Service positions, which have held up relatively well in light of the economic downturn, will hold steady at the start of the year from the current quarter, the Manpower survey indicates. Hiring intentions top those expressed for the start of 2002.

Forecasts for individual industry segments are as follows:

In the mining industry, accounting for seasonal adjustments, the coming quarter will mark a slight improvement in hiring compared to the end of 2002, the survey shows.

Construction jobs are expected to be stable through March 2003, but this would mark an improvement over the first part of 2002 when positions in the building trades were cut.

Within transportation and utilities, slightly improved hiring is expected, with job prospects best in the western states.

As can be expected after the holidays, wholesale and retail jobs will be eliminated compared to the current quarter, but employers note they will be taking on more help for the season this year than in the recent past.

Finance and real estate hiring trends to start the year will be little changed from the current quarter, which is still an improvement from one year ago, the survey shows.

Meanwhile, hiring for teaching positions will remain weak but won't turn worse to start the New Year. And, state and local budget constraints will keep the freeze in public administration hiring largely in place as 2003 begins.

Milwaukee-based Manpower polls by telephone 16,000 private- and public-sector employers for its quarterly survey. It has conducted surveys since 1976.

Intraday Data provided by SIX Financial Information and subject to terms of use. Historical and current end-of-day data provided by SIX Financial Information. All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only. Intraday data delayed at least 15 minutes or per exchange requirements.